Crypto Markets Rally Amid Renewed Optimism
Date Posted: May 26, 2025
LAHAINA, Hawaii – U.S. cryptocurrency funds have recuperated over $7.5 billion in weekly inflows, reversing the losses accumulated during February and March’s bear market correction, a new report from digital asset manager CoinShares reveals.
BTC Breaks Previous High Amid External Factors
Bitcoin prices recently surpassed its previous all-time high after President Donald Trump confirmed ongoing ceasefire negotiations between Russia and Ukraine on May 19. Coinbase reported a significant withdrawal of 9,739 BTC worth over $1 billion, the largest net outflow observed in 2025 to date.
Institutional Shifts Towards Digital Assets
The recent market performance follows the White House’s announcement on May 12 of a 90-day pause on additional U.S.-China import tariffs, which effectively reduced the levies by 24%. This policy shift contributed to heightened investor risk appetite across both traditional and crypto markets.
Global Macro Strategist Warns of Fiat Debasement
Leading macro investor Raoul Pal has intensified his call for investors to allocate capital towards cryptocurrencies. In response to the ongoing fiat currency devaluation, Pal asserts: “You don’t own enough crypto, NFTs. When you do, you don’t own enough NFTs. Art is upstream of wealth. Both will never be this cheap again.”
You don’t own enough crypto. When you do, you don’t own enough NFT’s, as art is upstream of wealth. Both will never be this cheap again.
“Furthermore, NFTs represent the single best long-term store of wealth I know,” Pal added.
US Crypto Dominates Fund Flows
Americas, particularly the United States, led global inflows, amassing $681 million last week alone. Overall, U.S.-based crypto products attracted $7.5 billion across five consecutive weeks with positive net inflows.
Flow data shows a stark contrast to Q1’s outflows, demonstrating a powerful market recovery. Key inflow markets included Germany ($86.3 million) and Hong Kong ($24.4 million).
Milestone Fund Launch on Avalanche
Asset manager VanEck is preparing to launch a new private digital assets fund focused on the Avalanche blockchain ecosystem. Dubbed the PurposeBuilt Fund, the offering targets accredited investors and will focus on liquid tokens and Web3 projects across sectors like gaming, AI, and DeFi.
Stablecoin Evolution: Focus Shifts to Yield
The dynamics of stablecoins are undergoing a significant transformation, with a marked shift towards yield-bearing instruments. Total value locked (TVL) in yield-bearing stablecoins has surged from $1.5 billion in 2024 to $11 billion currently, establishing their roles as potentially more attractive options than traditional dollar equivalents.
Pendle emerges as a key driver behind this trend. Its platform facilitates users locking funds to earn fixed yields or speculate on interest rates, accounting for nearly one-third (approx $3 billion) of total yield-bearing stablecoin TVL.
Tether Reserves Exceed Germany’s Treasury Holdings
Stablecoin issuer Tether announced for the third consecutive week that its U.S. Treasury holdings surpassed Germany’s, highlighting a portfolio diversification strategy increasingly adopted by crypto firms to manage market volatility.
DeFi TVL and Weekly Gainers
While the 100 largest cryptocurrencies by market cap showed mixed results last week, significant gains occurred elsewhere. DeFi protocols maintained increasing overall value locked. The top performer among the top-100 cryptos was Worldcoin (WLD) which rose over 32%.
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